Annual R&D spending in the telecoms sector has risen 4.5 percent to a nine-year high of just over £ 1 billion, according to ONS (Office of National Statistics) data.
R&D tax relief specialist Catax has broken out the UK figure and found that R&D spending across telecommunications businesses in the UK climbed £44 million to £1.02 billion in 2020 having risen for three years in succession.
However, the industry is unusual in that it hasn’t grown its R&D spending at all over the past decade.
The amount the industry spends on R&D has shrunk £101 million or 8.9 percent since 2010 when it registered £1.13 billion. It now makes up 3.8 percent of total UK R&D spending.
By comparison, across all sectors, UK R&D spending grew 3.5 percent last year to a record £26.9 billion. This was a rise of 67.9 percent since 2010.
The number of people employed by all UK businesses in R&D roles also reached a record high last year, climbing 6.8 percent to 283,000 full-time equivalents — an 83.8 percent rise since 2010.
The Government has set a target to bring UK R&D spending up to 2.4 percent of GDP by 2027. It is currently running at 1.7 percent of GDP according to the latest ONS figures.
Mark Tighe, CEO of R&D tax relief specialists Catax, said: “The telecoms sector is an unusual outlier in R&D terms. It has not grown its innovation spending at all in the past decade, which is alarming even if it has outperformed in growth terms over the past year.
“Things have been improving since 2018, however, and with 5G infrastructure, gigabit and satellite broadband demanding so much attention, the stronger growth of the past few years should continue to push R&D spending to new highs.
“A significant portion of this spending will be earning those companies responsible millions of pounds in R&D tax credits which can be reinvested straight back into R&D.”
Will anything happen? That is the question.
